Newspaper article Sarasota Herald Tribune

Local Man Faces Scheme Charges

Newspaper article Sarasota Herald Tribune

Local Man Faces Scheme Charges

Article excerpt

SEC ALLEGATIONS: Alvin S. Mirman sold 'blank- check' firms, agency says

The U.S. Securities and Exchange Commission has charged a Sarasota man with having a role in a penny-stock scheme that netted $6 million.

The SEC claims Alvin S. Mirman violated numerous federal securities laws by selling "blank-check" companies that were falsely presented to investors as legitimate start-up businesses.

Such companies are often used by individuals seeking reverse mergers with clean shells ripe for pump-and-dump schemes, the SEC said.

In connection with the case, another Sarasota man agreed to settle SEC accusations that he set up and sold one of the blank- check companies.

Edward T. Farmer will pay the SEC the $35,000 he received for selling that company. He is also barred from participating in any future penny-stock offerings.

The SEC's 56-page complaint brought fraud charges against 10 individuals in Florida and other states for selling penny stocks in blank-check companies that were bound for reverse mergers while falsely telling the public those companies were promising start-ups with business plans.

Blank-check companies typically have no operations or value other than being a registered entity. The SEC says that makes them attractive targets for scammers seeking reverse mergers with shells so they can conduct pump-and-dump schemes. Those are scams in which promoters inflate the price of stock they own through false positive statements so they can sell at a higher price.

Mirman, 77, a former stockbroker who was banned from the securities industry in 2007, is charged with being the incorporator and control person of at least 11 of the 22 blank-check companies cited in the SEC complaint.

He and others sold 18 of those companies, in reverse-merger or other change-of-control transactions, for $6 million from 2007 through December 2013, according to the complaint. …

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